Unemployment, loss of benefits and COVID-19 'problematic' for Calgary's housing market
New data shows Calgary's housing market is on its way toward righting itself, but there are still challenges ahead. (File)
CALGARY -- Housing sales in the city of Calgary did much better than originally forecasted, states a new report on the city's real estate market.
The data, compiled by the Calgary Real Estate Board, shows a 12 per cent improvement in sales activity during the third quarter of 2020 over the same period last year.
While the situation post-lockdown did absorb some of the losses the market experienced during the early months of the pandemic, CREB says sales are still down this year.
During the first half of the year, sales were 20 per cent below 2019 levels. Now, the year-to-date decline is only nine per cent.
"As the economy started to re-open, we saw some improvements in the economic indicators," said CREB chief economist Ann-Marie Lurie in a release. "Most industries are not back to pre-pandemic levels, but over the past three months we have seen notable improvement across most industries."
While the improvement may appear promising, CREB notes there is significant reason for caution when it comes to the city's housing market:
Unemployment remains high in Calgary and throughout Alberta and it's expected to stay that way until well into next year, with a full job recovery forecasted for 2022
Widespread lockdowns are not expected at this time, but, if they do take place, it could be difficult for some businesses struggling to make ends meet
Many government benefits that helped homeowners are ending and without that support, there could be an increase in the amount of new listings that would push supply levels back up
CREB adds migration is also a problem for Alberta.
For the first time since the early 1990s, it said more people left the province than arrived during the second quarter of 2020. This is due to migrants heading to other parts of the country and limits on international migration.
"If this trend continues, the impact will be felt throughout the entire housing market."
According to the report, the benchmark price of a detached home in the city of Calgary in the third quarter of 2020 is $487,567.